Conflux Network Announces First Hong Kong Dollar-Backed Stablecoin

Conflux Network, which claims to be the only regulatory-compliant, public, and permissionless Layer-1 blockchain in China, on Friday announced its role in launching Hong Kong’s first Hong Kong dollar-backed stablecoin axHKD with fintech company AnchorX.

Conflux Network and AnchorX Announces axHKD Stablecoin

AnchorX, a Hong Kong-based fintech company, has partnered with Conflux Network for scalability and security and OKLink Trust for custody services for its axHKD stablecoin, as per a press release on March 8.

The company plans to launch the stablecoin initially on Conflux Network, followed by the Ethereum blockchain. The axHKD stablecoin will ensure a 1:1 peg to the HKD, supported by high-quality liquid asset reserves protected by a segregated trust arrangement and held by the country’s regulated financial institutions, including 13 billion AUM private equity firm Hony Capital.

AnchorX plans AxHKD for two primary applications including global cross-border transactions and fiat-on-chain system for virtual asset trading. The company believes it will help uplift innovation in Real-World Assets and bridge the gap between traditional and digital assets in Hong Kong.

“This collaboration represents a significant milestone in the fusion of traditional finance and the Web3 realm, enhancing the practicality of digital currencies for everyday transactions,” said Conflux founder Fan Long.

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Hong Kong’s Stablecoin Sandbox

The Hong Kong Securities and Futures Commission (SFC) and the Hong Kong Monetary Authority (HKMA) have shown openness to regulate virtual assets amid rising demand. The Hong Kong authorities have also proposed a regulatory regime for stablecoin issuance.

Also, the stablecoin “sandbox” arrangement has attracted notable players including China’s Harvest Global. AnchorX also plans to explore participation in the upcoming regulatory sandbox for a sound stablecoin regulatory regime.

Hong Kong is also strengthening its regulatory framework with actions such as asking all crypto exchanges and firms to register for the crypto license before February-end.

Meanwhile, Conflux (CFX) price has jumped 5% in 24 hours and 25% in a week. The trading volume has also increased by over 60% over the last 24 hours.

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